Inside Malawi's fight for Loss and Damage funding

When COP28 President Sultan Ahmed Al-Jaber announced on the summit's inaugural day on 30 November that parties had reached an agreement to promptly operationalise the Loss and Damage Fund, it was news received with immense relief by countries like Malawi.

With more than USD 400 million already pledged for the fund by several wealthy nations (including the US, Germany and Japan) since the summit's outset, government leaders and campaigners regard this as a historic stride in addressing the climate crisis. 

"History has been made!" was the reaction of Malawi’s Minister of Natural Resources and Climate Change, Michael Usi, who led Malawi’s delegation to the summit in Dubai. 

Before heading to the conference, he told FairPlanet that advancing the climate finance agenda was Malawi’s top priority. He emphasised that climate finance wasn't a gesture of goodwill to nations most severely impacted by the climate crisis, such as Malawi, but a duty for affluent countries to fulfill their commitments.

"Their commitment is only a real score if they actually give us the money now," he said. "They cannot be putting spanners on the issue arguing, for example, that there is no universal definition of climate finance. So Malawi will respectfully and candidly discuss with these wealthy countries on this matter."

BATTERED BY the CLIMATE CRISIS

Malawi attended the conference burdened by the heavy toll of loss and damage caused by successive climate shocks over the past eight years.

In March this year, after barreling through Madagascar and Mozambique, Cyclone Freddy made landfall in Malawi. Three days of incessant rain led to rivers overflowing and triggered mudslides from mountains, devastating villages, crops, roads, schools, water and sanitation infrastructure and health facilities, particularly in the southern part of the country.

Roughly 1,000 people were killed and more than 2 million were displaced, according to a report by the Department of Disaster Management Affairs. 

The disaster struck as the country was grappling with the aftermath of floods triggered by Tropical Storm Ana in 2022, the impact of Cyclone Idai in 2019, severe drought in 2016 and the most severe flooding in a decade in 2015.

With the 2023-24 rainfall season just starting in Malawi, the Department of Climate Change and Meteorological Services forecasts delayed planting rains in some parts of the country and high chances of prolonged dry spells in the month of February due to El Niño. 

INSUFFICIENT DOMESTIC FUNDING 

Malawi, ranked one of the world’s poorest countries in the United Nations Human Development Index, has no capacity to adequately finance recovery from such heavy loss and damage on its own. 

For instance, a post-disaster needs assessment for Cyclone Idai, which hit the country in March 2019, estimated that the total loss and damage effects of the disaster amounted to USD 220.2 million, and stated that the government would require USD 370.5 million for resilient recovery and reconstruction.

At that time, government expenditure on environmental and climate change management averaged USD 12.5 million, or one per cent of its national budget's GDP, with the majority reliant on international financing for climate action, according to a report by the Ministry of Natural Resources on Malawi's climate finance landscape.

At COP27 in Egypt last year, an agreement was reached to establish a Loss and Damage Fund and offer financial support to countries vulnerable to the impacts of the climate crisis, including Malawi.

What stands in the way of the fund?  

Leading up to the Dubai conference, the operationalisation of the fund has been a rallying call of campaigners. 

Speaking to FairPlanet ahead of the official opening of the summit, Katherine Browne, a research fellow at Stockholm Environment Institute, highlighted the primary challenge associated with the Loss and Damage Fund: initiating the disbursement of funds.

She stated that there has been an ongoing disagreement between wealthier nations who will pay into the fund voluntarily and the less economically-developed and more vulnerable countries that will benefit from it. 

"Some of the main disagreements are about where the fund will be located, who will pay into it, how countries will access it and how to ensure funding reaches impacted communities," she said. 

According to Browne, many of these disagreements stem from profound mistrust between affluent and less affluent nations concerning climate finance matters.

"As you likely know, wealthy countries failed in their commitment to mobilise USD 100 billion annually by 2020 (pledged in the Paris Agreement). They also routinely double-count development aid as climate finance," said Browne, who studied international climate finance for seven years both at the annual COPs and through research in Madagascar, Mauritius and Namibia.

'A BIG WIN'

With the agreement on operationalisation now reached, campaigners such as Julius Ng’oma, the National Coordinator of Civil Society Network on Climate Change (Cisonecc) in Malawi, are describing it as a "big win" for the climate cause. 

Ng’oma told FairPlanet from Dubai that the approval of the fund's operationalisation, which is set to be administered by the World Bank, along with the commitment announcements exceeding USD 400 million during the summit, is heartening for African nations, especially the Least Developed Countries (LDCs), which bear the brunt of climate-related loss and damage.

"It’s a big win for Malawi which has seen the worst climate change impacts in the past few years from new climate hazards," he said, urging for a quick transfer of funds.

"What needs to happen now is for Malawi to put its house in order and ensure that we set up a proper national mechanism related to loss and damage for easy access to the financing," he added.

"We need some policies and strategies that would align with loss and damage framework at international level."

ADAPTATION DRIVEN BY LOCAL PRIORITIES

Beyond support from the world's wealthiest countries, LDCs are expected to implement specific measures to enhance resilience and adaptation to the climate crisis, complementing the assistance provided through loss and damage funding.

In her assessment of the efforts thus far, Browne said climate adaptation has been "widespread, but also fragmented and incremental." 

She further noted that its effectiveness, particularly over the long term, remains unclear. The insufficiency of financial and technical support at both the global and national levels has hindered its reach to frontline communities, she observed, adding that the poorest and most vulnerable countries receive less than their fair share of adaptation finance..

"Altogether, this means that we are not doing enough to match the speed at which the climate is changing. This may particularly be the case in LDCs."

"That said," she added, "a lot of adaptation is unfolding autonomously; that is, without external support. Though it is not well-understood, this adaptation can be effective in building resilience to climate changes, as it is driven by local priorities."

For instance, as part of the African Land Restoration Initiative, Malawi has undertaken to reforest and restore 4.5 million hectares of degraded landscapes by 2030 through natural forest management, conservation agriculture and agroforestry, signing partnerships with local banks that support these activities. 

ROLE OF COMMUNITIES 

In terms of the role that communities themselves can play, Browne emphasised that the most important thing is for them to seek out information about how climate change is likely to affect them in the coming years and decades.

Specific impacts like shifting precipitation patterns, sea level rise, desertification and reduced groundwater will vary widely not just from country to country, but also within nations. 

As such, communities cannot always rely on traditional knowledge of weather patterns as they happened in the past, seeing as the climate is shifting quickly and radically.

"They should [therefore] seek out meteorological predictions from national-level agencies," Browne concluded. "They can then share this information with community members and convene meetings to begin to plan for expected changes. These meetings should be as inclusive as possible, and should especially seek to include youth, who will be most affected by these impacts."